Over the last forty years, global capitalism has increasingly been shaped by the core tenets of neoliberalism. The neoliberal counter-revolution emerged as a response to the return of economic crisis in the 1970s, and to the power of working class and anti-colonial movements in the 1960s and 1970s.
It was geared towards the interests of wealthy and corporate elites, at the expense of the vast majority of working class and oppressed people worldwide. The divisions between the 1% and the 99% have become ever more acute, with the most extraordinary and ostentatious wealth for a tiny elite alongside hardship, insecurity and poverty for many people.
Cuts, privatisation, deregulation, trade liberalisation and outsourcing were all components of a wider political offensive. Consequently, exploitation has intensified, inequality has grown, and democracy has been hollowed out. This involved a massive effort to defeat trade-union opposition and break the resistance and organisations of the working class. Though largely successful in those terms, this capitalist offensive has fuelled economic crisis, social polarisation and a political backlash that takes various forms.
The rise of neoliberalism happened at the same time as capitalism expanded, and entrenched itself in new territories, becoming a truly dominant global system. The end of the Cold War gave particular impetus to the neoliberal mantras of free trade and globalisation, so that neoliberal policymaking has – with concerted pressure from supra-national institutions dominated by the interests of big capital in the Global North – become globally hegemonic.
This dominance was captured by Margaret Thatcher’s line, ‘there is no alternative’ in the 1980s and, a little later, by Francis Fukuyama’s proclamation of ‘the end of history’, suggesting that the upheavals of 1989-91 marked a final and conclusive victory for Western-style capitalism.
The capitalist crisis which unfolded from 2007/08 illustrated the failures of neoliberalism to resolve the deeper, long-term problems inherent in the system. Indeed, key elements of neoliberalism - like the growth of a deregulated finance sector and the increasing dependence on outsourcing - were vital factors in sharpening, deepening and prolonging that crisis. John Smith dubs this ‘capitalism’s final crisis’, both because he argues there is no plausible exit from the crisis (within the confines of capitalism) and because of the ecological dimension of capitalist crisis, which threatens the planet’s future.
Smith’s book, which compresses many years of research into a little over three hundred pages, is, first and foremost, an account of contemporary global capitalism in the wake of decades of neoliberalism. A British-based Marxist and activist, Smith has previously published very little (this is his first book) but he draws on his own extensive PhD research and on an even longer period of researching, and thinking about, the main issues. It contains a formidable array of evidence, with an assured grasp of the economic data, to support the main arguments.
Smith eloquently conveys the huge extent to which capitalism has changed as a result of neoliberal trends. The book is genuinely global in its focus, examining the main global trends and documenting the impact of a Western-dominated (and grossly unequal) system on the poorer parts of the world. It is also a savage indictment of the phenomena he describes, graphically revealing the human misery associated with the appalling working conditions - poverty pay, long hours, unsafe conditions and insecurity - dominating the lives of millions of working-class people.
Smith also develops a particular argument about global exploitation and inequality. He demonstrates with a wealth of data that the whole system has increasingly come to depend on the ‘super exploitation’ of impoverished workers in the ‘developing world’.
This exploitation generates massive surplus value for corporations based in the more developed global North. He provocatively argues that even many Marxist writers have underestimated the scale and significance of such ‘super exploitation’ for the global system, failing to give proper attention to the role of outsourcing in capitalist profitability. He offers a wealth of evidence that outsourcing, which involves corporations moving their operations to poorer countries with cheap labour to maximise profits, has grown enormously, and that neoliberal capitalism depends upon it.
It follows that not only has the working class grown globally, but also that the working class in the poorer nations has become more integral to the fortunes of global capitalism, and, therefore, more integral to the prospects for working-class struggle and emancipation. Neoliberalism’s restructuring of capitalism and recomposition of the global working class consequently has implications for anti-capitalist resistance and the challenge of re-building working-class strength. The book’s focus is largely on working-class people as the objects of social and economic transformation, but Smith clearly sees those victims of exploitation and neoliberal upheaval as the agents of social change too.
This is a very wide-ranging and ambitious book, but the opening chapter on the global commodity proves to be a shrewd entrance point to an exploration of several interrelated themes. The fact that today’s mass commodities rest upon super exploitation in the South – hidden from consumers’ view – is Smith’s starting point. He writes, in some detail, about three exemplary global commodities in twenty-first-century capitalism: the T-shirt, the Apple iPhone, and coffee.
Smith exposes the highly exploitative, and at times horrific, working conditions behind these commodities, for example the extremely low-paid work in dangerous conditions undertaken by mainly young, female workers in the garments sweatshops of Bangladesh. It is demonstrated beyond doubt that powerful corporations based in the North, especially the US, are the beneficiaries of this exploitation, and are responsible for the terrible conditions endured by workers. The relationship between capitalism in the ‘core countries’ and the labour done by these workers is carefully unpicked.
This vivid sketching of key commodities – chosen as exemplars, not for any exceptional reasons – brings to life what could threaten to be rather dry, economic material, humanising the economic processes under discussion. It is supported, later in the book, by analysis of labour conditions in the Global South: a very revealing interrogation of the everyday working conditions of vast numbers of workers, and how those conditions feed the profits of major corporations.
The massive increase in female workers - and their integration into the market and the acute nature of their exploitation – is an especially important element of this transformation in the working class. Smith is also astute about the role of migrant labour in contemporary capitalism, exploring how wealthier states (and their business elites) profit from migrant workers at the same time as using immigration controls to police the boundaries between the Global North and the Global South, which helps sustain inequalities.
One of Smith’s main arguments is that outsourcing is at the heart of corporate globalisation. Furthermore, he suggests that this has too often been overlooked as an absolutely central part of neoliberalism. When viewed as a global phenomenon, he argues, it becomes obvious that outsourcing has been integral to capital’s exploitation of labour in the neoliberal era. Corporations based in the North have increasingly focused on cheap Southern labour – sometimes on a huge scale – to address problems of profitability and to remain competitive.
As Smith writes:
‘Ultra-low wages are not the only factor attracting profit-hungry Western firms to newly industrializing countries … they are also attracted by the flexibility of the workers, the absence of independent unions, the relative ease with which they can be forced to submit to working days as long as those described by Marx and Engels in mid-nineteenth-century England, and the intensity with which they can work’ (p.24).The example of Apple (and other electronic) products, which depend on a vast complex of workplaces in Shenzhen, China, and massive levels of exploitation of those who work there, is offered as a powerful case study. This kind of outsourcing is at the core of the ‘imperialism’ of the book’s title: it perpetuates a systematically unequal relationship of super-exploitation of Southern workers by Northern-based capital.
Globalisation is revealed as a process of domination, not some mutually beneficial exchange, or spur to development in newly industrial countries, as the apostles of neoliberalism like to claim. Neoliberal globalisation is in reality imperialism without colonies.
The relationship between the Global North and the Global South is fundamental to twenty-first-century imperialism. At a theoretical level, one of Smith’s main concerns is to demonstrate the continuing relevance of the concept of imperialism, as developed by Lenin and others a century ago, and the ways in which our world continues to be structured in uneven and unequal ways by the richest and most economically advanced states. The book is therefore, among other things, a useful contribution to a Marxist understanding of what it means to talk about imperialism today.
Finally, Smith argues convincingly that the roots of the capitalist crisis since 2007/08 are in global production. He bases his analysis of the crisis in ‘the two principal measures that allowed the imperialist economies to escape, for a while, the crises of the 1970s – the enormous expansion of debt and the epochal global shift of production to low-wage countries’ (p.280). These therapies became pathologies for the system. He explains why nothing, within the constraints of capitalism, can now be done to ‘prevent a protracted, calamitous global depression’ (p.313).
This doesn’t mean that book is gloomy or fatalistic. Quite the opposite: it points to the enormous potential for fresh revolts by a greatly expanded, and exploited, working class. As the author concludes:
‘The southward shift of the working class, the reinforcement of the working class in imperialist countries through migration from oppressed nations, and the influx of women into wage labour in all countries means that the working class now much more closely resembles the face of humanity, greatly strengthening its chances of prevailing in coming battles’ (p.314).